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Novo Banco Is The Clean Brother Of BES: A Dramatic Case Study In Progress
- Novo Banco is a Bridge Bank with BES's sound business activities.
- All toxic assets will remain in BES, but depositors or other senior debt holders are not required to contribute to the losses.
- Novo Banco is a case study in the European financial system.
The Weakness Of The Euro Against The Dollar Is Poised To Continue
- The euro is the currency of an economic zone currently in crisis.
- The euro to US dollar exchange rate must reflect a comparison of the economic situation between the two areas.
- Despite the volatility, in the currency markets the trend between two currencies tends to persist for a longer time than anticipated.
Update: Oi S.A. Q2 '14 Earnings
- Oi reported weak results for Q2 '14.
- The company has high debt and needs to generate additional cash flow.
- As I've stated in my original article, Oi may be a good investment with a time horizon of 2 to 3 years.
Update: Cornerstone Q2 '14 Earnings
- Cornerstone is still investing for the future.
- It's significant that the company is working for clients all over the world.
- In my original article I've stated that the company was a long-term play.
Banco Espirito Santo: The Way An Insolvent Bank Turns Into A Good Bank
- The overwhelming disaster of the Espirito Santo Group has contaminated Banco Espirito Santo.
- From a bank with no possible survival to a good bank: everything happened in four days.
- A special legislation to assist troubled banks of the European Union was used for the first time with this Portuguese bank.
Update: TIM Participações Q2 '14 Earnings Show Potential For Development
- TIM is an important player in Brazil's mobile telecommunications business.
- The role of Telefonica is crucial to understand TIM's future.
- As I have mentioned in my original article TIM's strong market position may determine several options including a takeover.
Update: Lloyds H1 '14 Earnings In The Path Of Dividends
- Lloyds is still dealing with legacy charges which hurt profits.
- Strategic plans have strengthened the balance sheet to a significant extent.
- In my original article, I've stated that the bank would reach sustained development.
Update: Fiat Q2 '14 Earnings Disappoint
- Fiat and Chrysler remain working to solve merger issues.
- Results of the second quarter were disappointing.
- In my original article, I've stated my belief in the medium-term upside potential.
Update: GOL Traffic Figures For Q2 2014 Are Significant
- GOL reached its highest ever load factor in Q2 2014.
- The company remains focused on growing strongly in international market.
- In my original article I have stated that this strategy is key to the company.
Update: Cal-Maine Foods Q4 '14 Earnings With Enlightening Results
- Cal-Maine is a family owned company that is the largest producer of shell eggs in the United States.
- The company has been expanding steadily for decades, and has recorded sales growth at a 13.6% CAGR between 2007 and 2013.
- Confirming its upside potential earnings report for 2014 has reached my higher expectations.
Update: Wayside Q2 '14 Earnings With Mixed Results
- Q2 '14 results were mixed, but Wayside preserves a high dividend yield.
- Competition remains strong and pricing pressure is significant.
- In my original article, I've stated that gross margin is a key metric that has to be improved.
Oi SA And Portugal Telecom Have Signed A New Memorandum Of Understanding For The Merger
- Confirming unsolvable financial problems Rioforte defaulted on the payment of €847M to PT.
- This outcome is very negative for PT, but the two companies have signed a new Memorandum of Understandingfor the merger.
- The likelihood of this situation was already being advanced in my previous article.
Update: Oi Will Merge With Portugal Telecom Under What Conditions?
- Oi has asked clarification from PT regarding a €897M subscription of commercial paper issued by Rioforte, a member of Grupo Espirito Santo (GES).
- GES has huge financial problems which means that probably Rioforte will default leading to highly significant losses for PT and an urgent need to modify the merger terms.
- As we have predicted, it seems that GES alone has no acceptable options which may indicate not only default but its complete impossibility to find a solution on the medium-term.
Oi: The Merger Is At A Stage Of Suspense
- A merger that is taking too long to implement.
- Oi and PT seem to be far from each other in terms of management.
- The future has to be different in order to meet the real potential of the company.
Investing In Quality With My 85/15 Portfolio
- A portfolio to achieve long-term capital appreciation.
- Only quality stocks, and a time horizon of 20 years.
- Dynamic management and reinvestment are crucial.
Cornerstone Is A Growth Company In Search Of A Bright Future
- The company is a small cap, but has become a global leader of cloud-based talent management.
- Cornerstone is investing heavily in order to grow around 45% annually over the next years.
- The company has great potential to gain market share, and a promising customer base will lead to profits within a couple of years.
GOL Is Growing, But Remains Out Of Profits - Here's Why
- After 3 consecutive years of losses, GOL has failed to return to profits in the first quarter of 2014.
- Jet fuel prices and US Dollar/Real exchange rate have remained in negative levels.
- International market demand is very promising, and the company has adequate partnerships with larger airlines.
- Given positive estimates for the rest of the year, valuation previously made remains completely valid.
NewStar May Be Acquired And Rise Strongly; If Not, Another Down-Leg Is Likely
- NewStar Financial is a specialty lender with around $2.5B in assets that has a limited growth potential.
- With steady profits in the last three years, along with a clean balance sheet, the company seems to stay on the radar of larger banks.
- Share prices have been in a downtrend since December, and have lost around 45% of its value as sale expectations have failed to materialize.
- If the company intends to remain independent it has to struggle and most probably get a new business plan.
- If NewStar agrees to be sold in the short-term it may be worth around 1.4x book value, or $17.80 per share - a 55% upside.
Kodak's Fresh New Start May Be An Opportunity For Investors, But Caution Is The Buzzword
- Kodak has been a company with a long and extremely valuable history; now, its fresh new start is an opportunity to show its ability to innovate.
- The company filed for Chapter 11 protection in early 2012, and has emerged for a new life in September 3, 2013.
- Kodak is no longer producing cameras, has discontinued several businesses, and has sold the licenses of 20,000 patents.
- The company - reorganized and lean - is now in the competitive business of commercial printing technology; innovative new products are also being developed.
- Valuation has a few tricky assumptions, and medium-term projections are subject to relevant risks; it is essential to analyze the situation throughout this year. For now, I'm on the sidelines.
GOL Will Fly Higher And Faster With The Help Of New Partners
- GOL has a business plan suited to its main business risks: the oil price and the exchange rate of the dollar against the real.
- After years of profits, the company had to contain costs, boost revenue and optimize supply.
- An excellent Loyalty Program and extended strategic partnerships with Delta and Air France-KLM are key factors for its development.
- After a high loss in 2008, GOL returned to negative territory in the last three years; the company has a turnaround in progress.
- With an improving 4Q13 and a demanding strategy plan, the company can sustain risks, stimulate the business, and represent a promising investment.
Cal-Maine Foods: An Obvious Case Study With A Remarkable Catalyst For 75% Upside
- With a market capitalization of $1.48B, Cal-Maine is the largest producer of shell eggs in the United States.
- Cal-Maine is a company that has grown firmly throughout decades. Once a target for short positions, the company is now free from this problem.
- The company has been a leader in industry consolidation and its growth strategy is more than ever strongly based in acquisitions.
- Sales have been increasing at a steady pace; while selling prices are up and feed costs down, demand remains very strong, and value added products are gaining market share.
- Stock prices have maintained an upward long-term trend; with strong catalysts, valuation of ~$2.64B leads to 75% upside.
Wayside: Consistency, Great Dividend, Rising Profits, And Upside Potential
- Wayside is an undervalued micro-cap offering sophisticated information technology solutions, and it focus on niche market segments.
- The company has no debt, has been profitable for over a decade, and pays a dividend yield of 4.33%.
- Being a solid company, it has plenty of room to develop the business, and can be a great investment.
- To significantly boost net income the company needs to increase gross margin just slightly; if it succeeds, valuation of ~$122M would lead to 60% upside.
TIM Gets An Unexpected Catalyst: Sale To The Liking Of Authorities, 40% Upside
- Telecom Italia, which has been experiencing financial problems, holds a 67% stake in TIM, the second-largest Brazilian telecommunications company.
- TIM is having a good performance, especially when compared to its peers, and its value may increase accordingly.
- Telefonica dominates the management of Telecom Italia; considering that it also owns VIVO, leader of the Brazilian market, Anatel wants a quick solution in terms of market consolidation.
- TIM shareholders are in a winning position. While there is the option of joining with GVT, the most likely outcome is the sale and division of assets by its rivals.
- If Telecom Italia agrees to sell all of TIM's assets in parts to its peer group, share prices will tend to rise consistently. Valuation of ~$16B leads to 40% upside.
- Tesla: A Crazy Bubble, A Valuable Investment, Or A Project With Truly Gigantic Potential?
- Is The Euro Worth 38% More Than The Dollar?
- GOL: Will It Fly Higher After February 26th?
- Fiat Chrysler Automobiles: A New Life, 80% Upside
- Goldman Sachs Will Climb Soon
- Cal-Maine Foods: This Solid Company Is A Buy
- Japanese Stocks Crash: What To Do?
- Oi And Portugal Telecom: A Merger That Can Be A Great Opportunity
- Apple: A Piggy Bank Forever?